Taxpayers needing more time to file their taxes can get an automatic six-month extension from the IRS. For most taxpayers, this year’s tax-filing deadline is today, April 15. Taxpayers who live in Maine or Massachusetts have until April 17, 2019 to file their returns. This is because of the Patriots’ Day holiday on April 15 in those two states, and also because the Emancipation Day holiday on April 16 in the District of Columbia.
There are a few different ways taxpayers can file for an extension.
IRS Free File. While taxpayers can use IRS Free File to prepare and e-file their taxes for free, they can also use it to e-file a free extension request. The IRS must receive an e-filed extension request by midnight on the day of the filing deadline. Taxpayers can access Free File to prepare and e-file their return through October 15.
Form 4868. Taxpayers can request an extension using the Application for Automatic Extension of Time to File U.S. Individual Income Tax Return.
Electronic payment options. The IRS will automatically process an extension of time to file when taxpayers pay all or part of their taxes electronically by the April deadline. They don’t need to file a paper or electronic Form 4868 when making a payment with IRS Direct Pay, the Electronic Federal Tax Payment System or with a debit or credit card. When paying one of these ways, taxpayers will select “extension” as the reason for the payment. Taxpayers should print out a confirmation as proof of payment and keep it with their records.
Here are a couple things for people filing an extension to remember:
More time to file is not more time to pay. An extension to file gives taxpayers more time to file their return, but not more time to pay their taxes. Taxpayers should estimate and pay any owed taxes by the April deadline to help avoid possible penalties.
The IRS can help. The IRS offers payment options for taxpayers who can’t pay all the tax they owe. In most cases, they can apply for an installment agreement with the Online Payment Agreement application on IRS.gov. They may also file Form 9465, Installment Agreement Request. The IRS will work with taxpayers who can’t make payments because of financial hardship.
If you do owe money and have not paid your taxes you are facing the potential of two different penalties. These penalties are for failure to file, and failure to pay. Below we will explore the differences between these two penalties and what they may mean for you:
Whenever you are hit with a failure-to-file penalty you are going to be charged 5% of the taxes you owe for each month you are late. This will cap off at 25% of your total unpaid taxes. If you are over 60 days late filing your taxes, the minimum penalty is either $205 or the entire amount of the unpaid tax, depending which is less expensive.
The failure-to-pay penalty is .5% of unpaid taxes for each part of a month you’re late, up to 25% of the unpaid taxes due. This is the penalty you’re charged if you file on time but don’t pay what you owe. However, if you request an extension to file and pay at least 90% of taxes owed, you may not be charged any failure-to-pay penalties as long as you pay the remaining 10% by the extended due date.
For failure to pay and failure to file is 5% of unpaid taxes for any month in which you owe both penalties.
If you are already late filing and paying your taxes, do not let you penalties get any worse. Work with Enrolled Agent, Sandra King, and get your taxes over with! If you do not have the money to pay your taxes off we can explore other options to find a solution to your financial dilemma without making it worse.
Sandra King Enrolled Agent
Sandra King is an enrolled agent, empowered by The United States Treasury to prepare your personal or business tax filing. While her services are offered nationwide, Sandra King locally serves the greater Dallas-Fort Worth area, including but not limited to Arlington, Bedford, Colleyville, Euless, Fort Worth, Grand Prairie, Hurst, Mansfield, North Richland Hills, and Richland Hills.